Summary
MongoDB reported second quarter fiscal 2023 revenue of $303.7 million, up 53% year over year. Atlas revenue grew 73% and represented 64% of total Q2 revenue. The customer base expanded to over 37,000 customers as of July 31, 2022, compared with over 29,000 a year earlier. Direct sales customers rose to over 5,400 from over 3,600. Atlas customers increased to over 35,500 from over 27,500. Customers with $100,000 or greater in annualized recurring revenue and annualized monthly recurring revenue reached 1,462, up from 1,126. The net ARR expansion rate remained over 120%. MongoDB released MongoDB 6.0 for general availability and held its MongoDB World event in New York City with approximately 3,000 attendees, 35 sponsors, 290 speakers and more than 200 sessions. Gross profit was $215.4 million, and gross margin rose to 70.9%. Non-GAAP gross margin was 73%, compared with 72% in the year-ago period. Operating loss widened to $114.8 million. Net loss widened to $118.9 million. Non-GAAP net loss was $15.6 million, or $0.23 per share, compared with $7.7 million, or $0.12 per share.
The company continued to invest heavily in growth. Non-GAAP sales and marketing expense was $143.7 million. Non-GAAP research and development expense was $64.7 million. Non-GAAP general and administrative expense was $27.2 million. Total headcount reached 4,240 as of July 31, 2022, up from 2,934 a year earlier. Sales and marketing headcount was 2,159, up from 1,380. Research and development headcount grew 31%. Support and services headcount grew 38%. Operating cash flow was negative $44.7 million, down from negative $19.8 million. Capital expenditures were $2.6 million, up from $1.7 million. Free cash flow was negative $48.6 million, compared with negative $22.7 million. Deferred revenue rose 50.5% to $375.2 million.
Management issued guidance for the third quarter and full year fiscal 2023. Third quarter revenue is expected to be $300.0 million to $303.0 million. Full year fiscal 2023 revenue is expected to be $1,196.0 million to $1,206.0 million. Third quarter non-GAAP loss from operations is guided to ($10.0) million to ($8.0) million. Full year non-GAAP loss from operations is guided to ($13.0) million to ($8.0) million. Third quarter non-GAAP net loss per share is guided to ($0.19) to ($0.16). Full year non-GAAP net loss per share is guided to ($0.35) to ($0.28). The company noted that a reconciliation of non-GAAP guidance to the most directly comparable GAAP measures is not available without unreasonable efforts because of the high variability and low visibility of stock-based compensation and related charges.
The outlook carries several risks. MongoDB said the macroeconomic environment negatively affected the growth of existing applications during the quarter. It expects the macroeconomic environment to continue to negatively impact revenue growth for the remainder of the year. Other named risks include the ongoing COVID-19 pandemic, the military conflict between Russia and Ukraine, rising interest rates, inflation, and volatility in the global economy and financial markets. The company also cited competition, its history of losses, the need to add new customers and expand sales to existing ones, the ability to manage growth, security and privacy concerns, and stock price volatility. MongoDB expects to continue to incur operating losses and may continue to experience negative cash flows from operations. It intends to invest heavily to grow the business rather than optimize for profitability or cash flow in the near term. The increasing share of Atlas revenue may pressure gross margin because of associated hosting costs. Revenue is also subject to seasonality and consumption-based fluctuations.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2023 | Q1 FY2023 | QoQ | Q2 FY2022 | YoY |
|---|---|---|---|---|---|
| Revenue | $303.7M | $285.4M | +6.4% | $198.7M | +52.8% |
| Gross profit | $215.4M | $207.2M | +3.9% | $138.0M | +56.0% |
| Gross margin | 70.9% | 72.6% | -1.7 pp | 69.5% | +1.5 pp |
| Research & development | $108.0M | $96.4M | +12.1% | $72.4M | +49.2% |
| Sales & marketing | $181.6M | $150.3M | +20.8% | $109.4M | +66.0% |
| General & administrative | $40.6M | $36.5M | +11.1% | $28.8M | +40.9% |
| Total operating expenses | $330.2M | $283.2M | +16.6% | $210.6M | +56.8% |
| Operating income (loss) | -$114.8M | -$75.9M | -51.2% | -$72.5M | -58.3% |
| Operating margin | -37.8% | -26.6% | -11.2 pp | -36.5% | -1.3 pp |
| Net income (loss) | -$118.9M | -$77.3M | -53.8% | -$77.1M | -54.1% |
| Net margin | -39.1% | -27.1% | -12.1 pp | -38.8% | -0.3 pp |
| Customers | 380,395 | 181,648 | +109.4% | 268,610 | +41.6% |
Risks
MD&A states that during the three and six months ended July 31, 2022, the macroeconomic environment negatively impacted growth of existing applications and affected revenue growth, and the company expects this to continue for the remainder of the year. Risk factors also cite inflation, rising interest rates, and the Russia-Ukraine conflict as pressures on IT spending.
The business depends on customers renewing subscriptions and expanding usage, and a majority of subscription contracts were one year in duration in fiscal 2022. Macroeconomic pressure on existing application growth could reduce renewals or expansion, which would harm revenue.
The database market is highly competitive, with legacy providers IBM, Microsoft, and Oracle and cloud providers AWS, GCP, and Microsoft Azure able to bundle competing products, offer lower prices, and devote greater resources. Intense competition could cause the company to lose or fail to renew customers.
Risk factors highlight increasing ransomware and supply-chain attacks, including reported ransomware attacks on MongoDB instances that the company believes succeeded because Community Server users failed to enable recommended security settings. A security incident could lead customers to reduce or terminate use and result in litigation, regulatory investigations, and reputational damage.
The sales cycle is long and unpredictable, generally three to nine months and sometimes more than a year, and a large portion of sales occur toward the end of each quarter. This makes revenue timing difficult to predict and can push revenue into the next quarter.
Growth depends on expanding the sales and marketing organization, but the company faces significant competition for experienced sales professionals and heightened employee attrition. Sales and marketing headcount rose to 2,159 as of July 31, 2022 from 1,380 a year earlier, increasing execution risk.
Community Server is offered under the SSPL or AGPL, and the SSPL has not been interpreted by courts or approved by the Open Source Initiative. If these licenses are unenforceable or deter adoption, competitors may use the software and the company's ability to monetize and protect intellectual property could be harmed.
The conditional conversion feature of the 2026 Notes was triggered during the three months ended July 31, 2022, making the notes convertible at holder option from August 1, 2022 through October 31, 2022. If holders convert, the company may be required to make cash payments, which could adversely affect liquidity.
MongoDB Atlas revenue represented 64% of total revenue for the three months ended July 31, 2022, up from 56% a year earlier, and MD&A notes that increasing Atlas mix may pressure gross margin due to associated hosting costs. Gross margin was 70.9% in the current quarter, up from 69.5%, but the mix shift remains a risk.
SaaS KPIs
All quarters →Total Customers
MongoDB Atlas Customers
Direct Sales Customers
Free Cash Flow
Net ARR Expansion Rate
Customers over $100K ARR
Summary, forecast, risks and KPIs are extracted from MongoDB, Inc.'s SEC filings for Q2 FY2023 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 1, 2026.